We appeared to have come up a little short on a Monday silver "breakout", but the week is not over. Keep your eye on it! We are not yet convinced beyond all doubt that the international banking cartel has not affixed its death grip around the Chinese currency and commodity markets. The historical evidence says it does.
Previously, Asian investors had to access international markets to trade silver futures, or else they could trade indirectly on local Chinese markets.
"There has been an absence of a means of trading in silver in China," Wang Ruilei, an analyst with precious metal trader CGS Co Ltd, told China Daily. "The market will be bigger and more liquid with the advent of these futures contracts."
The Chinese announcement allows for two major things to take place.
First, it means that U.S. exchanges and sentiments will no longer dominate futures trading in the silver market.
These two facts bode well for silver futures long term.
China allowing investors wider access to the silver market will pump more money into the commodity. In addition, it will make it more difficult for American speculators to manipulate the markets in their own favor.
We can expect some volatility in the market as commodities investors absorb and process China's news, but any price lows should be buy-in points.
Silver's Price Rally
China's news isn't the only catalyst boosting silver prices.
Philip Klapwijk of GFMS says silver sales for industrial application as well as for jewelry, silver, silverware and photography will rise as end-users restock inventories that diminished in late 2011. Fabrication demand makes up 80% of total demand for the metal, and should be up about 3% to 5% this year to roughly 900 million ounces.
Finally, the stops put on American silver market manipulators will be another huge factor in silver's coming rally.
Ted Butler, who publishes bi-weekly commentary at www.butlerresearch.com with a special focus on the silver market, said that while silver market manipulation is currently helping depress silver prices, that won't be the case for long. Once the manipulators are stopped -- which, Butler said, always happens when they're controlling an investment in such a manner -- silver will soar higher to where the price would be without a rigged market.
"Therefore, the manipulation is giving silver investors a double-barrelled bonanza," Butler told Money Morning Global Resources Specialist Peter Krauth. "One, a cheap price to buy at than would otherwise be the case and, two, a much higher price to sell at once the manipulation is ended."
There are already signs of a subtle beginning to silver's 2012 price push. This means it's time to pay attention to silver's dips as buying opportunities.
If you're still wondering what to buy as silver shoots through the roofin 2012, then you need to take a look at our special report: How to Buy Silver: A Guide to Today's Top Silver Investments.
In that exclusive report, we explain all of the opportunities involved in silver investing.
Related Articles and News:
- Money Morning: Buy on the Lows as Silver Prices Will Rally in 2012
- Money Morning: The Bernanke Effect on Gold Prices, Silver Prices Means Time to Buy Metals
- China Daily: Futures exchange to offer contracts for silver
